How to Counter the Media’s Misinformation About the NAR Settlement
As if the red-hot sellers’ market of late didn’t cause enough anxiety for Americans who long for their own homes, along comes a lawsuit to add to the problem.
Not to get all doomy and gloomy, but Americans are being bombarded by mainstream media articles about what their journalists expect the NAR settlement will mean to buyers, sellers and agents.
“And many headlines aren’t separating fact from fiction, feeding misinformation to you and your clients,” according to the legal team at the NAR.
Only you, as the boots on the ground in the industry, can help clear it up for the average real estate consumer.
The biggest myth you’ll most likely run up against
Remember the aforementioned Reuters headline: “…“Home buying costs could fall.”
As you know, the only thing guaranteed to “fall” when this settlement is approved (sometime in mid-July) is home selling costs. The typical home seller makes out like a bandit in this deal.
Maybe I’m wrong, but home sellers aren’t having a tough enough time selling right now that they are willing to give away, in concessions, a huge hunk of their equity.
The myth that homes will magically be more affordable to buyers is something that urgently needs busting. Who better to do that than the true experts in real estate: Agents?
This will make it easier for buyers to negotiate fees
“The $418 million settlement … makes “it easier for buyers to negotiate fees with their own agents or use no agents at all.” (Emphasis is ours)
How will the latter work?
How will the average homebuyer gain access to tour homes for sale without an agent? Will the listing agent have to be on hand to show their listings to unrepresented buyers? Many agents don’t mind double-ending deals (in states where it is legal) IF they are compensated for all the extra work and responsibility when representing both sides.
If these unrepresented buyers lack an agent because they don’t want to pay an agent, why would the listing agent act as a buyer’s agent as well? Especially when one considers that the listing agent still maintains all the legal and ethical ramifications of dual agency, without the additional compensation.
Let your potential buyers know that, since they’ll most likely have to pay a fee for representation, they may as well have the protection of exclusive representation during the purchase.
Present the coming reality, gently
Judi Desiderio, chief executive of Town & Country Real Estate in East Hampton, New York told the folks at Reuters.com that “Some buyers could end up paying more for homes.”
She is correct. Sellers will be no longer on the hook to pay the buyers’ agent commission.
At today’s average home price, nationwide, this outlay for buyers may be from 1% to 3%, or from $4,177 to $12,531.
Again, real estate consumers are hearing from the media that not only will their homebuying costs come down, but prices may too.
A gentle reminder to potential clients that “housing prices are dictated by market forces,” [NAR], not lawsuits, should help curb their enthusiasm to buy into the media’s narrative.
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